Updated from 4:11 p.m. EST

Stocks on Wall Street had a volatile morning Thursday before selling off sharply late in the session as traders continued to grapple with signs of economic malaise and fret about the fate of the auto industry.

The Dow Jones Industrial Average, which had traded in a range of more than 350 points, ended down 444.99 points, or 5.56%, at 7552.29. The S&P 500 plummeted 54.14 points, or 6.7%, to 752.44, and the Nasdaq dropped 70.30 points, or 5.1%, to 1316.12. The S&P 500 last closed lower on April 14, 1997. The Dow had its lowest close since March 12, 2003.

On Wednesday, the market fell hard, and when the new session arrived, another set of grim economic data kept the sellers in control. The Labor Department reported that jobless claims for the week ended Nov. 15 had increased by 27,000 to reach 542,000, the highest level since 1992. Economists had anticipated claims numbers to come in at 503,000.

"In past recessions, investors eventually ignored bad employment data, having been numbed to the data by previous data and plentiful evidence of impending doom," Tony Crescenzi, chief bond market strategist for Miller Tabak, wrote on his RealMoney.com blog.

Crescenzi said that investors will still have to wait for additional indications of the depth and severity of the downturn before determining that the market has discounted the worst of what is to come. "Data need not get better to spark a rally, they need only stop getting worse," he wrote.

Meanwhile, economists at the University of Michigan said the U.S. is indeed in a recession and that the worst won't come until the middle of next year.

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